BY | APRIL 14, 2021 · 9:03 AMFarms and financing–that’s a common combination in agriculture. Because farm operators often use financing arrangements to fund the capital-intensive nature of farming, we created the Financing the Farm law bulletin series. The series aims to help operators, especially new and beginning farmers, understand the legal workings of farm financing arrangements.
We’ve just added two new bulletins to the Financing the Farm series. “Personal Guarantees and Agricultural Loans” address the legalities of a personal guarantee–a personal promise made by a third party to pay the loan if the borrower fails to do so. We explain when lenders might require a personal guarantee for a loan, how a personal guarantee works, and issues and implications for entering into this type of agreement.
Our second new bulletin is “Understanding Operating Loans.” We discuss how operating loans can meet the cyclical needs of agricultural financing and review different types of operating loans. Security interests are a common feature of operating loans, and we explain that component of the loan agreement.
The news bulletins are available here on our Ag Law Library’s Farm Finance Law shelf along with these other topics in the series:
- Mortgages
- Promissory Notes
- Installment Contracts
- Leasing Arrangements
- Secured Transactions
- Statutory Agricultural Liens
The Financing the Farm series is made possible through our partnership with the National Agricultural Law Center, with funding from USDA’s National Agricultural Library.